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Synopsis: There is a need to unlock the PM KUSUM scheme promises in many ways.
The Union Minister of Power, New and Renewable Energy recently reviewed the progress of the PM-KUSUM scheme and reaffirmed the government’s commitment to accelerating solar pump adoption.
About the PM – KUSUM Scheme
Pradhan Mantri Kisan Urja Suraksha evam Utthaan Mahabhiyan (PM-Kusum) scheme was launched in 2019. It aims to help farmers access reliable day-time solar power for irrigation, reduce power subsidies, and decarbonise agriculture.
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About the performance of the Scheme
PM-KUSUM provides farmers with incentives to install solar power pumps and plants in their fields. They can use one of three deployment models: off-grid solar pumps, solarised agricultural feeders, or grid-connected pumps.
Off-grid pumps have been the most popular option for farmers. So far nearly 2,80,000 systems deployed. But this falls far short of the scheme’s target of two million by 2022.
What are the challenges associated with the PM-KUSUM Scheme?
Limited awareness and Farmer’s inability: Farmers have limited awareness about solar pumps. Further, many farmers struggle to pay 30-40% of upfront costs in compliance with scheme requirements. Apart from that, Farmers cannot access bank loans without collateral.
Issues associated with solarised agricultural feeders and grid-connected pumps: Farmers fail to adopt these due to regulatory, financial, operational and technical challenges. For instance, Only a handful of states has initiated tenders or commissioned projects for solar feeders or grid-connected pumps.
Challenges with Discoms: Selling surplus power to discoms is one of the main attractions of grid-connected models. But, most Indian discoms have a surplus of contracted generation capacity and are wary of procuring more power in the short term. So, the discoms show very less interest to buy excess power generated under the scheme.
Further, the grid-connected model requires pumps to be metered and billed for accounting purposes, but it suffers from a lack of trust between farmers and discoms.
How to improve the performance of the PM-KUSUM Scheme?
First, extend the scheme’s timelines: Extending PM-KUSUM’s timelines beyond 2022 would allow discoms to align the scheme with their power purchase planning. Further, adopting solutions like smart meters and smart transformers and engaging with farmers can build trust between discoms and farmers.
Second, create a level playing field for distributed solar plants: At present, discoms often find utility-scale solar cheaper than distributed solar (under the scheme) due to the latter’s higher costs and the loss of locational advantage due to waived inter-State transmission system (ISTS) charges.
To tackle the bias against distributed solar, India needs to standardise tariff determination to reflect the higher costs of distributed power plants and do away with the waiver of ISTS charges for solar plants.
Third, streamline land regulations: Inter-departmental coordination has to be made to streamline land regulations in India. Further, it will also help in reducing delays in leasing or converting agricultural lands for non-agricultural purposes such as solar power generation.
Fourth, support innovative solutions: To address the farmer’s inability to pay the upfront cost, India needs to develop innovative and out-of-the-box solutions. For example, India can implement Karnataka’s pilot project of a farmer-developer special-purpose vehicle to help farmers install solar power plants on their farms.
Fifth, extensively pilot grid-connected solar pumps: India has to pilot the solar pumps in different agro-economic contexts. This will be critical to developing a strategy to scale it up.
In conclusion, the KUSUM scheme, if implemented successfully, can generate thousands of jobs, reduce the carbon footprint of agriculture, and result in oil import savings.
Source: This post is based on the article “Revitalising PM-KUSUM” posted in The Hindu on 28th September 2021.